A fraud follow-up by Kelly at the Voice of San Diego:
All of the 81 condos from the Sommerset Villas, Sommerset Woods and Westlake Ranch complexes involved in the scam have been repossessed. Twenty-four have yet to find new buyers. But the other 57 have resold for prices drastically lower than the mortgages were worth, let alone the initial purchase prices.
The U.S. taxpayer is paying for the mounting losses. Across the complexes, the cost to taxpayers is at least $7.8 million.
When the units were just in the beginning stages of foreclosure, it was too soon to tell whether the government-sponsored mortgage companies, Freddie Mac and Fannie Mae, had definitely purchased the shaky loans. Now that the units have gone back to the bank and resold, public records clearly show the majority of these units had mortgages that were sold to Fannie and Freddie — now largely owned by taxpayers.
Take Sommerset Villas. The 26 units previously owned by McConville’s straw buyers that have resold as foreclosures have sold, on average, for 71 percent less than the purchase prices in 2008. And some have been worse: A 480-square-foot studio apartment that sold for $265,000 in 2008 sold in October for $47,000 — an 82 percent drop.
That’s added up to at least $3.8 million in losses for Fannie and Freddie so far in just that complex. Add to that estimate a $2.7 million loss in Sommerset Woods, and a $1.3 million loss in Westlake Ranch, according to an analysis of property records.